Apple reaches settlement with New York State AG over e-book pricing lawsuit

While Apple announced that it had reached a tentative settlement with New York State regulators in June over allegations that it fixed e-books prices, it did not reveal the terms of that agreement. On July 16, however, New York Attorney General Eric Schneiderman announced Apple’s agreement to pay up to $400 million to consumers who purchased e-books when the tech giant was allegedly fixing prices.

The settlement is contingent on Apple’s appeal of a 2013 federal anti-trust hearing, which found the company had violated antitrust laws by working with publishers to inflate the price of e-books. If the ruling is appealed, Apple will still be responsible for a repayment of up to $50 million. The company will only shirk its responsibility to the settlement if a retrial throws out the original verdict.

"This settlement proves that even the biggest, most powerful companies in the world must play by the same rules as everyone else," Schneiderman said in a release.

Apple contends that it had no part in the conspiracy and maintains that it did nothing wrong.

When Apple was found guilty of conspiring to fix prices in 2013, the Department of Justice (DOJ) did not impose any monetary penalties. Instead, the DOJ imposed institutional controls on the company, including a 10-year injunction, an internal monitor to oversee e-book sales, and a requirement to allow other e-book sellers — such as Amazon — to be able to link to their own e-book stores through iOS.

Apple also contends that the court appointed monitor over charged for his services and that the company was not given other monitor options. Apple fought to have the monitor, Michael Bromwich, replaced, a request that was rebuffed by a federal judge, but is pending consideration by the 2nd Circuit.

The suit that was settled by Schneiderman was brought on behalf of the consumers of New York State. Though plaintiffs had initially sought $840 million in the case, the $400 million afforded to them is seen as a victor by the AG’s office.

“We will continue to work with our colleagues in other states to ensure that all companies compete fairly with the knowledge that no one is above the law,” Schneiderman said.

Executive Editor

Chris DiMarco

Chris DiMarco, Executive Editor of InsideCounsel magazine, has a background in multimedia production with previous involvement in projects in which he developed and created content...